Asset-Based Lending vs. Leveraged Finance

Summary

This practice note discusses the differences between asset-based lending and leveraged finance. Asset-based lending (sometimes referred to as ABL) has evolved over the years to become an essential source of funding for a large number of companies. ABL originated as a financing option for small and medium-size enterprises without access to other traditional forms of financing. However, ABL has evolved to provide a flexible, efficient and inexpensive source of capital, not only for small and medium size enterprises, but also for larger companies, including those with access to the capital markets generally.